Points 7 and 8 in your 10 step plan

Wednesday, 16 April 2014 | Tom

Nice to speak to you again and welcome to points 7 and 8 of the 10 key points to doubling your turnover. The next two points contain to principles that are going to revolutionise the way you go about business, when I discovered them and understood them they were one of my biggest breakthroughs in my own business life and I can’t wait to share this information with you.

Here are points 7 and 8.

The “Buying Customers” Principle.

The buying customers principle is literally what it says on the tin. How much does it cost you to buy a customer? This is why I get so annoyed when I hear companies talking about marketing budgets, when people talk about marketing budgets they are basically saying “how much money can I afford to loose as I don’t really know how effective my marketing is”. Marketing budgets are utter nonsense!

Let me put this in simple terms. If we were sat in a pub having a drink and you had £100 in your pocket, and every time you gave me £100 I would give you £1,000 back, at what point would you stop giving me £100. You wouldn’t. This is what the buying customers principle is all about.

Go through your facts and your numbers, I cannot stress how important knowing your numbers is, and work out exactly how much you are willing to spend to get a customer. When you have figured this out, you will no longer even utter the words marketing budget, as you know as soon as you spend a certain amount (providing your marketing and sales team are effective) you will never stop spending that certain amount to get a customer.

The “Customer Value” Principle.

This is a very simple principle, find out exactly how much on average a customer is worth to you over 3 years. This then allows you to see the exact return you get over a certain period of time from the initial (usually very small in comparison) investment you made to buy the customer.

Lets go back to the sitting in a bar together example. If you worked out that it costs you £100 to buy a customer and that over 3 years you will receive £1,000 from that customer (if not more) are you going to stop buying new customers?

I urge you to take the time to go and work out these numbers and start to make sure you get rid of this fantasy that you have to have a marketing budget; people that have strict marketing budgets are no good at marketing. However this does not mean go out and find £1,000,000, give it to someone and hope it works. You still have to keep tabs on everything making sure that it is working and you will find that things plateau at a certain point, so the secret is keeping your spend and return in that sweet pot seeing a maximum return every time.

I hope these 2 principles really open your eyes to ways you can increase your turnover dramatically and how simple it can actually be sometimes.